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Boeing 737 Max grounding hits the forcast sale of American Airlines

American Airlines had to cut down its sales forecast after being forced to drop hundreds of flights involving the grounded Boeing 737 Max 8 aircraft.


Now the airline demands a key measure of total revenue to be even or grow by 1% during the first quarter, compared to previous forecasts of a 2% increase.
Well, the firm is the second largest operator of the Boeing 737 Max 8 in the US.
The jet is at the center of two fatal crashes in Indonesia and Ethiopia with a gap of five months.
American Airlines also said that it was unable to forecast how much the disruption would cost the company.
Since the Boeing 737 Max 8 was grounded in the US on 13 March, American Airlines has cut 1,200 flights and has extended cancellations through its second quarter to 30 June, which will affect about 90 flights a day.
However, the plane is grounded as investigations continue into the Ethiopian Airlines crash last month which killed all 157 people on board.
It struck an earlier disaster in October when a 737 Max 8 flown by Indonesian airline Lion Air crashed, claiming the lives of 189 people.

American Airlines

The financial costs of this disruption in future periods cannot be forecasted at this time. It will depend upon a number of factors, including the period of time the aircraft is unavailable and the circumstances of any reintroduction of the aircraft to service.
With the incident, American Airlines’ share price plunged by 2.8% to $32.94 in early trading.
Meanwhile, Boeing is working on a fix to the anti-stall system, known as MCAS, in 737 Max 8 planes which preliminary reports suggest caused both the Lion Air and the Ethiopian Airlines flights to repeatedly nosedive.
Also, American Airlines operates 24 of the 737 Max 8 planes and has an additional 76 jets on order from Boeing.
And Southwest Airlines is Boeing’s largest customer for the 737 Max 8. Which already operates 34 of the jets out of a total order for 250 planes.
Currently, Boeing has cut production of the 737 airliners which will drop from 52 planes a month to 42 from mid-April.

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About the author

Esther Korado

Esther Korado

Esther has worked as a journalist for various print-based magazines for 2 years. She brings together relevant news pieces from various industries especially Technology and Business.
Email: esther@techozen.com

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